It’s probably not too soon to start imagining what changes there will be in daily life once the coronavirus is under control.

home food delivery

Online ordering through Whole Foods or Amazon has been impossible.  The wait for a Costco delivery slot has been two weeks+   …until yesterday, when suddenly (I hadn’t looked for a while) slots for same-day as well as every day for the next week were available.  Everything I ordered was in stock–delivered three hours later  …another change.

To me this suggests that panic buying has subsided.

Instacart

What really caught my eye is Instacart, which powers many food delivery services.  Not in a way that makes me itching to invest, though.  The markup on the food was 26%, after including a 5% tip.  That’s a lot, I think.  For a family of four that spends $1000 a month on food, Instacart would cost an extra $3000+ a year.  During a pandemic, this is probably not an issue for most people.  But in normal times, this seems pretty steep to me.

I don’t think home delivery will go away.  But it seem to me that potential new competitors have lots of room to undercut Instacart’s markup.  Also, it would seem to me that delivery from centralized warehouses is inherently less costly than hiring someone to shop in a supermarket in your place.

a surprisingly hardy breed

A caveat–two, actually:  I’m not an expert on supermarkets; grocery is, to me, a weird and wacky industry, with greater staying power than I would ever have imagined.  My town, for example, offers only a number of very dated, inefficient food stores.  A national chain has been trying to build a superstore for over twenty years on commercially zoned land it bought from a department store moving to a nearby mall.   Protests by “citizens’ committees” funded by the incumbent grocers have blocked redevelopment, as I understand the situation, despite the deterioration of the neighborhood as small businesses in need of an anchor have left.

The economics of physical grocery stores is also more complex than I would have thought–all mixed up with payments from manufacturers for premium space, the role of house brands, ancillary services like banking or a pharmacy…

Anyway, this is to say that supermarkets may be harder to kill than it seems on the surface (just look at department stores, which have been dying for almost fifty years).